The rail link will connect its Boikarabelo mine to the existing Transnet Freight Rail network.

The company has begun the construction of associated infrastructure, including the pad for the base of the construction camp, associated access roads and further infrastructure for the mobilization of site activities.

Managing director Paul Jury said the preparation work was expected to assist the timely construction of the rail link.

“We see this as an important step towards facilitating the total construction of the Boikarabelo mine,” Jury said.

“This start will also enable site operational procedures to be tested and optimised prior to the start of full-scale construction.

The Australian Stock Exchange-listed company signed a binding term sheet with Noble Resources International, a wholly owned subsidiary of commodity trader Noble Group, for the $US55.3 million loan facility to fund the rail works earlier this month.

The Boikarabelo project is expected to produce an initial 6Mtpa, split equally between export and domestic coal.

It has probable reserves of 744.8Mt of coal on 35% of the company’s tenements.